Management Reports • Feb 28, 2018
Management Reports
Open in ViewerOpens in native device viewer
FORWARD-THINKING SOLUTIONS TO LEVERAGE THE FOURTH INDUSTRIAL REVOLUTION
3-Year Business Plan
Biesse Group is a global leader in the technology for processing wood, glass, stone, advanced materials and metal. Founded in Pesaro in 1969 by Giancarlo Selci, the company has been listed on the Italian Stock Exchange (Star) since June 2001. Starting from October 2015 Biesse is included in the Mid-Cap segment.
3-Year Business Plan
3
is all about Biesse Group's ability to innovate and provide integrated solutions that are sophisticated but easy to use, allowing our customers to produce more, better and at a lower cost.
It encourages us to look ahead before deciding how acting today.
1.1 WHO WE ARE 1.2 OUR VALUES 1.3 BUSINESS MODEL
1
3-Year Business Plan
"…back when we were simply producing machines,
I was talking with a dear friend, and realised that the rough, imprecise way he was working was ineffective, and above all, dangerous to his personal safety. At that moment, I recognised a need for change, and immediately understood that we could do something - we could introduce innovative new ways of working, automate processes, and above all, create safer working conditions.
A new kind of machine was about to be born".
We believe in challenging standards, in thinking forward and in acting differently.
OUR
BELIEFS
Creating advanced technologies and beautifully -designed solutions is the key to transforming our beliefs into real value.
3-Year Business Plan Who we are
8
We manufacture machines and components for wood, glass, stone, advanced materials and metal processing through specialised business units and 12 manufacturing sites in Italy and worldwide.
IN
3-Year Business Plan Who we are
Growing investments in R&D have enabled us to create technological solutions that have simplified the management of CNC machines, improving our customers' processes revolutionizing market standards.
HOW
3 -Year Business Plan Who we are
We support our colleagues everywhere in the world, using the most advanced management, sales and support system. Our global network enables us to be always close to our customers.
. Manufacturers of furniture, design items and door/window frames, producers of elements for the building, nautical and aerospace industries.
More than 4,000 employees throughout the world (temporary workers included) are our Human Capital Value
1.1 WHO WE ARE 1.2 OUR VALUES 1.3 BUSINESS MODEL INNOVATION RELIABILITY EXCELLENCE
3-Year Business Plan
Innovation is the driving force for the way we do business, continuously striving for excellence to support our customers' competitiveness.
Innovation is hard-wired in our DNA. Past, present and future.
3-Year Business Plan Our Values
Our main principles:
3-Year Business Plan Our Values
02
15
03
Cash
01
Revenue
1.1 WHO WE ARE 1.2 OUR VALUES 1.3 BUSINESS MODEL
1.3
3-Year Business Plan Business Model
20
GLASS WOOD
02
STONE
PLASTIC
We create engineered solutions, from plant design to production, implementation, installation and maintenance
04
01
We design, manufacture and distribute a comprehensive range of machinery and technologies for processing wood, glass, stone and advanced materials
05
We manufacture custom made blends of diamonds and alloy tools for glass, stone and synthetic materials processing, which have been developed and field tested to meet customer requirements.
We offer technical service and machine/component spares anywhere in the world on-site and 24/7 on-line with our global network and highly specialised team even using the SOPHIA platform
03
3-Year Business Plan
We design, manufacture and deliver high-tech mechanical and electronic components for machinery INDUSTRY 4.0 ready.
21
3-Year Business Plan Business Model
GLASTRÖSCH
GRUPPO LUBE
PACCALINI
PEDINI
CUSTOMERS
WOOD BUILDING COMPANIES AND MANUFACTURERS
GLASS WORKERS
25
2.1 STRATEGY & RESULTS 2.2 PRODUCTS 2.3 SOLUTIONS 2.4 CUSTOMER EXPERIENCE BUSINESS PLAN UPDATE
2
2.1 STRATEGY & RESULTS
2017E SUCCESSES
3-Year Business Plan Strategy & Results
3-Year Business Plan Strategy & Results
Differentiation
3-Year Business Plan Strategy & Results
2.4 CUSTOMER EXPERIENCE
EXCEEDING TARGETS
33
Titanium
2.4 CUSTOMER EXPERIENCE
EXCEEDING TARGETS
3-Year Business Plan Solutions
3-Year Business Plan
IoT remote assistance On Line parts ordering
3-Year Business Plan Solutions
The single, integrated platform to manage all machine processes has been fully implemented on machines.
2.4 CUSTOMER EXPERIENCE
EXCEEDING TARGETS
Differentiation Take Over
Results
2017
Revenues in Western Europe in 2017 +29.3 mln/€
1,800 SOPHIA presentation
in 2017
10,000 Demos in 2017
40
3-Year Business Plan Customer Experience
Our goal is to identify 4.0 Industry - oriented Customers in order to provide them with a new business model focused on software and integration.
In the smart factory of tomorrow, each component is traced and identifiable enabling automatic feedback and process statistics to be generated.
30% Super Systems
Smart for all
41
70%
| E R V I C E S |
P T I M I Z A T I O N |
R E D I C T I V I T Y |
U M A N |
N N O V A T I O N |
N A L Y S I S |
|---|---|---|---|---|---|
SOPHIA is the IoT platform, created by Biesse in collaboration with Accenture, which enables its customers to access a wide range of services to streamline and rationalise their work management processes.
Smart Products
Smart Services
New Customer Experiences
3-Year Business Plan
HSD: a 4.0 factory Manufacturing Lab Training Academy
3.1 CONTINUOUS GROWTH 3.2 MORE PRODUCTS 3.3 MORE SOLUTIONS 3.4 MORE CUSTOMER EXPERIENCE 2020 NEW TARGETS
3
3.1 CONTINUOUS GROWTH
2018 - 2020 PERSIST IN OUR STRATEGY
Market Estimated CAGR 2018-2020
5%
Market Estimated CAGR 2018-2020
6%
Market Estimated CAGR 2018-2020
Mechatronics Division Estimated
Tooling Division Estimated CAGR 2018-2020
Wood Division Estimated
G&S Division Estimated
CAGR 2018-2020
CAGR 2018-2020
CAGR 2018-2020
12.9%
40%
14%
8%
12%
A.M. Division Estimated CAGR 2018-2020
3-Year Business Plan Continuous Growth
3.2
The competition in the current market is consolidated. We are the second leading company in the sector. Main competitors are located in Germany and in Italy. The most important of these (easily comparable) are HOMAG in Germany (30.5% estimated market share) and SCM in Italy (7,5% estimated market share*).
Estimated Market Size
2017
worldwide market share 2017
Whole market potential €3.6bn
3-Year Business Plan More Products
Wood division Estimated CAGR 2018-2020 vs 2017
Market Estimated CAGR 2018-2020vs 2017
Improve product reliability, renew
02 Renovation and completion of the range of machines
Enhance R&D for innovative solutions (technologies and new materials)
Expand the product range of woodworking machines for the housing market
3-Year Business Plan More Products
The competition in the market is consolidated. Main competitors are located in Germany and in Italy. The most important of these are Hundegger (the Market Leader), HOMAG and Weinmann in Germany and SCM, Essetre in Italy.
Estimated worldwide market share 2017
3-Year Business Plan More Products
15 €/mln
2020 Target in wood construction
Biesse Group will continue to extend its product range, increasing penetration in the high potential segment (actually forecasted the best one) yet highly-strategic industry of timber carpentry (beams and structural façades).
materials machines market 01 Expand our offering in other timber carpentry segments (minor complexity and higher volumes)
02 Leverage on Biesse capillarity to boost sales and after-sales worldwide
3-Year Business Plan More Products
We are currently the industry leader in the glass processing market in which we operate. Main competitors are located in Italy and Germany, Austria:
they are CMS, Bottero, Lisec, Hegla
3-Year Business Plan More Products
The competition in the current market is consolidated. We are among the leading companies in the sector and we intend to reinforce our positioning. Main competitors are located in France and in Italy and they are CMS, Breton,Denver and Thibaut,Comandulli
2017 Stone Market Size
Estimated worldwide market share 2017
Whole market potential €650mln
G&S Division Estimated CAGR 2018-2020 vs 2017
Market Estimated CAGR 2018-2020 vs 2017
01
02
Expand our offering in new product segments
Increase our market share in the stone segment, reinforcing our leadership in 03 this area
14%
Tooling Division Estimated CAGR 2018-2020 vs 2017
Market Estimated CAGR 2018-2020 vs 2017
2018-2020 three years Business Plan
01
Maintain and reinforce our leading position in the glass sector
Expand our offering in new product segments
02
Increase our market share in the stone segment, reinforcing our leadership in this area
Our mechatronics division is currently the leader in the WAP (Wood Advanced Materials*. Plastic) spindles sector. We entered the metal spindles sector. Our main competitors are from Germany. They are KESSLER. IBAG. GMN. WEISS (Siemens). FISHER and STEPTEC.
Composite
Alluminium
Titanium
3-Year Business Plan
12.9%
Mechatronics Unit Estimated CAGR 2018-2020 vs 2017
Market Estimated CAGR 2018-2020 vs 2017
01 Maintain and reinforce our leading positioning in the Wood- Aluminum-Plastic (WAP) sector
02 Enlarge our product offering for metal working machines
2020 target in metal sector
03 Continue to expand abroad, especially in Asian and Western Europe Market
The advanced material* processing machinery market is highly fragmented worldwide, main competitors are Geiss, HG Grimme, Belotti CMS Industrie, Breton, Mecanumeric, Multicam and Flow Corporation
*Advanced materials Carbon Fiber Foam Composite Alluminium Titanium
Estimated worldwide market share 2016 2017 A.M. Market Size Whole market potential €0.8 bln
3-Year Business Plan
40 mln/€ 2020 target In advanced material segment
Expand our plastic working machineries in order to 01 meet the needs of the entire market.
02
Extend our product range drawing on the expertise of Uniteam to enhance its range of products and applications for machining advanced composite materials for several industries
Packaging
3.1 CONTINUOUS GROWTH 3.2 MORE PRODUCTS 3.3 MORE SOLUTIONS 3.4 MORE CUSTOMER EXPERIENCE
Our network supports our customers worldwide. Through Biesse service and Biesse parts. we offer technical services and machine/component spares to businesses anywhere in the world onsite. as well as on-line - 24/7.
incidence on Net Sales Predicitve: leave "break-and -fix" service as is logics and anticipate the needs moving onto predictive services thanks .
Digital: Fully implement On Line Sophia Services platform to offer advanced remote assistance, Spare Parts purchasing, Intelligent Troubleshooting, software update distribution and machines connection to Customer ERP
Master in Competence: Structure Training Academy supporting product and process competence to our Customers and Service team
3-Year Business Plan More Solutions
We increased our market share becoming a leading company in the engineering solutions sector.
The guiding strategy of the Biesse Systems team is based on clear key concepts:
More Solutions
Potential Software Fees contribution to Net Sales
01
Consolidation. reliability and rationalization. Superior technology for creating synergies in machine automation.
Technological superiority and sustainability. Ensuring advanced. sustainable know-how in order to develop intelligent machines.
Simple. smart software. Meeting growing technological needs through application software and smart apps.
04 Business software. Business-oriented software to enhance collaboration with our customers' businesses.
3.4
3-Year Business Plan
To expand our global presence to be close to our customers.
Continue to promote the "Roadmap to success" for our subsidiaries: moving from reactive to proactive, fostering entrepreneurship at all levels, defining market and customer-oriented strategies 01
02 Invest in new and innovative technological complexes, "Biesse Campus", to better contain our expansion in selected areas
Invest in human resources and capabilities as growth drivers
3-Year Business Plan
Live the Experience at the Biesse Group booth during exhibitions:
Continue to improve our Campus, increase the number of the Inside and one-to-one events and measure their impact on the local market.
Continue to invest in exhibitions taking part in shows for all sectors including composites.
3-Year Business Plan
Biesse supports its customers, offering technological connectivity, sharing of expertise, professional consulting services, training and ongoing assistance.
SOPHIA helps to prevent problems that could damage customer production. Biesse takes proactive steps to contact customers, reducing machine downtime and inefficient wasted time.
The information gathered and analysed is transformed into useful indications for optimising customer production and product quality, providing extremely opportunities for growth.
3-Year Business Plan
Connected machines by 2020
With its new IIOT platform, Biesse is transforming itself from product-oriented manufacturer to a digital business offering to its customers value added services
4.1 OUR FUTURE IN FIGURES 4.2 OTHER FIGURES 4.3 ANNEX 4.7 THE SHARE
Continue our growth path
Optimize our production cost
9.5%
Net sales
< 39%
Target COGS
< 30%
Target Labor Cost
incidence on Net Sales
< 20%
Target Overhead Cost on Incidence on Net Sales
CAGR 2018-2020 vs 2017
incidence on Net Sales
Invest in human resources and capabilities as growth driver, controlling incidence on net sales
Optimize Overhead cost
3 -Year Business Plan
€/mln
3-Year Business Plan
the "old" and the "new one"
Confirming the growth growth path to consolidate our leadership
control our Operating Net Working Capital.
4.1 OUR FUTURE IN FIGURES 4.2 OTHER FIGURES 4.3 ANNEX 4.7 THE SHARE
4.2
17 19 20 21 25 32 39 45 48 4,4% 5,0% 5,2% 4,9% 4,9% 5,2% 5,7% 5,9% 5,7% 5,6% total capex value total capex % on sales €/mln - % 2011 2012 2013 2014 2015 2016 2017e 2018e 2019e 2020e
*potential growth strategy through M&A not included
3-Year Business Plan Others Figures
2018e tangible: € 27.4mln intangible: € 17.6mln
main investments drivers:
Indian Manufacturing durable goods investments to meet the projected productive expansion improving the quality
Housing ( Uniteam Wood Division): improvement production plant – durable goods investments ,
continue our growth path through investments
ASSETS
Mechatronics Italian plant (HSD S.p.A.) components production machines (rotary tables) and production plant TANGIBLE
Metal working (internal phase): improvement of the components production – durable goods investments ,
| €/mln | 2013 | 2014 | 2015 | 2016 | 2017e | 2020e | Targets | |
|---|---|---|---|---|---|---|---|---|
| Net sales -1 year |
378.4 -1.2% |
427.1 +12.9% |
519.1 +21.5% |
618.5 +19.1% |
690.3 +11.6% |
CAGR 9.5% |
906.5 | |
| Cost of good sold |
155.9 41.2% |
177.6 41.6% |
206.1 39.8% |
245.1 39.6% |
270.2 39.1% |
348.1 38.4% |
||
| Value added % |
147.0 38.8% |
167.8 39.3% |
212.4 40.9% |
252.4 40.8% |
289.3 41.9% |
CAGR 10.8% | 393.2 43.4% |
|
| Labour cost |
112.7 29.8% |
128.2 30.0% |
148.2 28.6% |
176.6 28.6% |
200.4 29.0% |
266.0 29.3% |
< 30% incidence |
|
| overhead | 81.8 21.6% |
91.0 21.3% |
104.7 20.2% |
124.5 20.1% |
135.1 19.6% |
167.7 18.5% |
< 20% incidence |
|
| EBITDA % |
34.3 9.1% |
39.6 9.3% |
64.1 12.4% |
75.8 12.3% |
89.0 12.9% |
CAGR% 12.7% |
127.2 14.0% |
|
| EBIT % |
18.1 4.8% |
24.8 5.8% |
43.7 8.4% |
55.1* 8.9% |
63.5* 9.2% |
CAGR 14.7% |
95.8 10.6% |
| €/mln | 2013 | 2014 | 2015 | 2016 | 2017e | 2020e | Targets |
|---|---|---|---|---|---|---|---|
| Inventories % net sales |
22.8% | 23.0% | 21.5% | 21.1% | 20.7% | 20.0% | <22% |
| Receivables % net sales |
20.1% | 18.9% | 20.3% | 20.8% | 17.3% | 19.2% | DSO 55 days |
| Payables % net sales |
29.4% | 28.8% | 29.5% | 31.1% | 32.3% | 31.4% | DPO 120 days |
| Operating Net Working Capital % net sales |
51.4 13.6% |
55.6 13.0% |
63.4 12.2% |
66.9 10.8% |
39.4 5.7% |
70.2 7.7% |
|
| Net Debt | -23.9 | -11.3 | 0.0 | 4.9 | 30.3 | 106.0 89 |
|---|---|---|---|---|---|---|
| Δ Net Debt |
12.7 | 11.3 | 4.9 | 25.4 | 28.2 vs 2019e | |
| dividends | -4.8 0.18 per share |
-9.8 0.36 per share |
-9.8 0.36 per share |
-9.8 0.36 per share |
-16.6 30% of net profit |
|
| Net Cashflow % net sales |
32.2 8.5% |
17.5 4.1% |
21.1 4.1% |
14.7 2.4% |
35.2 5.1% |
44.8 4.9% |
| Investments % net sales |
-19.8 5.2% |
-20.8 4.9% |
-25.2 4.9% |
-32.0 5.2% |
-39.2 5.7% |
-50.5 5.6% |
| Gross Cashflow % net sales |
52.0 13.8% |
38.3 9.0% |
46.3 8.9% |
46.7 7,5% |
74.4 10.8% |
95.3 10.5% |
| €/mln | 2013 | 2014 | 2015 | 2016 | 2017e | 2020e |
post-non recurring items
116 116 113 128 148 177 200 222 244 266 29,7% 30,4% 29,8% 30,0% 28,6% 28,6% 29,0% 29,2% 29,3% 29,3% labour cost labour cost margin €/mln - % 2011 2012 2013 2014 2015 2016 2017e 2018e 2019e 2020e
| (Without interim people) | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| FY 2010 |
FY 2011 | FY 2012 | FY 2013 | FY 2014 | FY 2015 | FY 2016 | FY 2017 | ||
| Production % of total people |
965 41% |
1.250 46% |
1.265 45% |
1.175 44% |
1.201 42% |
1.335 42% |
1.482 41% |
1.494 39% |
|
| Service & After sale % of total people |
568 24% |
577 21% |
574 21% |
613 22% |
628 22% |
690 22% |
803 22% |
894 23% |
|
| R&D % of total people |
293 12% |
316 12% |
338 12% |
321 12% |
361 13% |
383 13% |
436 12% |
479 12.5% |
|
| Sales & Marketing % of total people |
340 13% |
361 13% |
364 13% |
351 13% |
439 15% |
495 15% |
587 16% |
641 17% |
|
| G & A % of total people |
202 9% |
233 9% |
242 9% |
235 9% |
252 9% |
273 9% |
310 8.5% |
338 8.8% |
|
| ITALY % of total people |
1.660 70% |
1.656 61% |
1.646 59% |
1.547 57% |
1.605 56% |
1.780 56% |
2.009 56% |
2.176 56% |
|
| OUTSIDE ITALY** % of total people |
708 30% |
1.081 39% |
1.136 41% |
1.148 43% |
1.276 44% |
1.396 44% |
1.609 44% |
1.670 44% |
|
| TOTAL | 2.368 | 2.737 | 2.782 | 2.695 | 2.881 | 3.176 | 3.618 | 3.846 | 93 |
| FY 2010 |
FY 2011 | FY 2012 | FY 2013 | FY 2014 | FY 2015 | FY 2016 | FY 2017 | |
|---|---|---|---|---|---|---|---|---|
| ITALY % of total people |
1.660 70% |
1.656 61% |
1.646 59% |
1.547 57% |
1.605 56% |
1.780 56% |
2.009 56% |
2.176 57% |
| OUTSIDE ITALY** % of total people |
708 30% |
1.081 39% |
1.136 41% |
1.148 43% |
1.276 44% |
1.396 44% |
1.609 44% |
1.670 43% |
| TOTAL | 2.368 | 2.737 | 2.782 | 2.695 | 2.881 | 3.176 | 3.618 | 3.846 |
vs Dec 2016: +228 ( 6.3%) vs Dec 2016: +670 (18.5%) vs Dec 2014: +965 (26.7%)
interim people at the end of Dec 2017: 196 (181 at the end of 2016) 4,042
| FY 2016 | FY 2017 | % | |
|---|---|---|---|
| Production | 1,482 | 1,494 | +0.8 |
| Service & After sale |
803 | 894 | +11.3 |
| R&D | 436 | 479 | +9.8 |
| Sales & Marketing | 587 | 641 | +9.2 |
| G & A |
310 | 338 | +9.0 |
| ITALY | 2,009 | 2,176 | + 8.3 |
| OUTSIDE ITALY | 1,609 | 1,670 | + 3.8 |
| TOTAL | 3,618 | 3,846 | +6.3 |
3-Year Business Plan
People outside Italy: nr. 1,670 People in Italy: nr 2,176
3-Year Business Plan
People outside Italy: nr. 2,021 People in Italy: nr 2,497
Others Figures
98
4.1 OUR FUTURE IN FIGURES 4.2 OTHER FIGURES 4.3 ANNEX 4.7 THE SHARE
Drivers and impact
3-Year Business Plan
Source: Bloomberg January 2018 statistics
102
3-Year Business Plan
3-Year Business Plan
Global economic activity continues to firm up
Source: FMI January update
3-Year Business Plan
Source: Bloomberg January 2018 statistics
3-Year Business Plan
3-Year Business Plan
(BUILDING INVESTMENTS RESIDENTIAL + NON RESIDENTIAL)
Source: CRESME
107
3-Year Business Plan
furniture consumption by countries
where Biesse is insisting…:
108
3-Year Business Plan
consolidated net sales Biesse
«During the year that has just ended. we saw an increase in production of 11.6% with a strong impact of the domestic sector (+13%).
With regard to the expectations for 2018, Acimall anticipates a prudent growth between 3-5%. Conditioned, as ever, by the results of the planned policies of incentivation».
Italian woodworking machineries & tools manufacturers association «Excellent results for the year 2017 with a global increase for the production of 10.1%. This result has been mainly due by the uptrend in the domestic market (+ 13.8%) that is therefore beating the pre-crisis level. The expectations for the 2018 are for a general increase of 8.2% still mainly driven and supported by the incentives (fiscals and economics) and the Industry 4.0 development».
Italian machines tools. robots and automation manufactures association
Verband Deutscher Maschinen- und Anlagenbau, Mechanical Engineering Industry Association
«The woodworking machinery production totally rised again in 2017especially with the domestic market overlapping (+20%) the export portion (+12%). The expectations for the 2018 are still positive with a general 3% growth rate. In particular the woodworking segment is seen growing with a 8% rate.».
3-Year Business Plan
(XYLEXPO 2018 PRESENTATION EXTRACT) ACIMALL FOCUS Annex
7.5% 14.4% 15.5% 18.7% 22.3% 17.5% 19.6% 0,0% 5,0% 10,0% 15,0% 20,0% 25,0% Felling and forestry Primary industry, production of … Building materials Furniture (solid wood based) Furniture (panel based) Joinery Trade of woodworking machines … 0.9 1.5 1.2 Italian GDP outlook
4.1 OUR FUTURE IN FIGURES 4.2 OTHER FIGURES 4.3 ANNEX 4.7 THE SHARE
4.4
3-Year Business Plan
3-Year Business Plan
Building tools?
Free accounts include 100 API calls/year for testing.
Have a question? We'll get back to you promptly.